Last month, Boku was covered here as a company which is “ripe for takeover” in a Stock Focus special
A month on, the shares have rise from 195p to 226p, a decent gain of 16%, despite no M&A news at all. Instead, we have had the latest Trading update for the six months ended 30 June 2025. Entitled “Empowering merchant growth through our global LPM network and strategic execution” it was certainly a positive affair. Adjusted EBITDA is anticipated to be at least $21 million, up c.50% on the prior comparative period (H1 2024: $14.2 million), reflecting an adjusted EBITDA margin of c.33% (H1 2024: 30.1%). Boku‘s own cash grew by 16% to c.$87 million at 30 June 2025, up from $75.2 million at 30 June 2024 and $80.2 million at 31 December 2024. This includes the impact of the repurchase of 5.8 million Boku shares during H1 2025 at a cost of $12.3 million. Previous guidance in relation to organic revenue growth exceeding 20% on a compound annual growth rate (CAGR) basis over the medium term and achieving adjusted EBITDA margins in excess of 30% remain unchanged.
All of this is absolutely golden, with the question being who is best to take the company forward? Boku itself, or a larger international player? The answer may be neither. Instead, the true issue here may be whether the key services the company provides to Big Tech, are simply too important for the tech company in question not to have BOKU under its belt. It is this strategic value, which is arguably even more important than the 20% CAGR, or being set to beat market expectations for the full year.
New Target 330p
Last month the call here was 230p by the end of July on a break of 195p. The shares have so far peaked at 226p, with just a few days of July left. What can be said now is that at the current rate of progress anything over 230p could be the harbinger of a more serious rally for the shares, whether or not a takeover arrives for this cash generating machine. From a technical perspective the next level up is the upper parallel of the 2022 rising trend channel heading for 330p. This could be hit as soon as the end of September on any quick break of 230p in coming days.
Disclaimer & Declaration of Interest:
The information, investment views, and recommendations in this Zaks Traders Cafe interview are provided for general information purposes only. Nothing in this interview should be construed as a promotion or solicitation to buy or sell any financial product relating to any companies under discussion or referred to or to engage in or refrain from doing so or engage in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the commentator but no responsibility is accepted for actions based on such opinions or comments. The commentators may or may not hold investments in the companies under discussion.
